Save Our Savers campaign: 'Make Isas fair and stop punishing the people who save for all our future'

More than 5,000 readers have backed Financial Mail’s Save Our Savers campaign for a better deal on Isas.

Though launched only two weeks ago, SOS has already drawn support from leaders representing building societies, life insurers, stockbrokers and pensioner champions.

Financial Mail believes savers have paid too heavy a price for the folly of the banks after the 2008 financial crisis. Savings rates have been slashed and banks and building societies have rebuilt their capital at the expense of savers.

Security: Jessica Helliwell wants to save to buy a home

About 17 million households have savings accounts and many, especially those where the main breadwinner is retired, depend on the interest to meet their regular bills.
Financial Mail believes a simple step the Government could take would be to shake up the rules on tax-friendly Individual Savings Accounts.

At present, adults can put up to £11,280 every year into Isas. But only half can be put in a tax-free cash account – the rest must be invested in risky shares or investment funds.
Financial Mail has launched an e-petition calling for Isas to be made more saver-friendly.

If 100,000 sign it, the Government will come under pressure to discuss the matter in the House of Commons. Chancellor George Osborne could amend the Isa rules in his Autumn Statement on December 5.

Lesley Mallett and Jessica Helliwell – from different ends of the age spectrum – are among those to have signed the petition last week.

Lesley, 55, a housewife from Swarland, Northumberland, says the Isa rules ‘blatantly discriminate’ against savers.
Lesley, whose husband David, 62, is a retired print worker, says: ‘We’ve saved all our lives and not having taken our pensions yet we live off the income from our savings. Boosting the cash Isa limit would go some way to make up for the low interest rates available.’

Jessica Helliwell, a 21-year-old student from Huddersfield, West Yorkshire, is also backing our campaign. Jessica is hoping to become a special needs teacher when she graduates next year from Sheffield Hallam University. She received a five-figure inheritance three years ago when her paternal grandmother Muriel died.

‘It would have been nice to put all the money inside a cash Isa, but I couldn’t because of the archaic restrictions,’ says Jessica, who was a volunteer ‘Games Maker’ at the Olympics.

She hopes to use the money to put a deposit on a house. ‘My grandmother wanted me to use the inheritance for something special,’ she says.

Insurance and building societies' bosses on why they back Save Our Savers Campaign

David Barral, chief executive of Aviva UK Life, Colin Franklin, director of Coventry Building Society and David Cutter, chief executive of Skipton building society, explain why they are supporting Financial Mail's campaign for a better deal for cash Isa savings.

David Cutter: 'Better Isas will help get the nation saving again'

We are hugely keen that people plan for their future and want to do as much as possible to raise awareness of the importance of saving. We know that the typical amount a family holds in savings is just £1,131 while the average sum put away each month is only £29.

Yet we also know that one of people’s biggest financial fears is unexpected costs, so any initiative urging people to save is laudable. Savers need confidence to invest in what is right for them.

So the greater choice and flexibility there is, then potentially the better result all round. That said, people must be aware cash saving is one of many options.

Cash Isas offer the ability to access cash quickly and easily – so an increase in the allowance makes sense. If the proposed changes urged by Financial Mail are made to Isa allowances then, in theory, overall this should lead to more people saving, which has to be a good thing.

We need to get the nation saving again.

Colin Franklin: 'Don’t force public to gamble on shares'

There is a phrase, usually attributed to the economist John Maynard Keynes, that goes: ‘When the facts change, I change my mind. What do you do?’

Isa rules have always favoured investing in stocks and shares. And perhaps in 1999, when they were launched, it was felt reasonable to encourage savers to fuel a growing economy.

Nobody needs to be told things are different in 2012 – difficult economic conditions, the lowest Bank of England base rate in history, uncertainty in the eurozone – public confidence is not what it used to be.

At times like this, it is understandable if some would prefer to invest in ‘boring’ savings accounts rather than more volatile stocks and shares.

However, to gain the full tax-free benefit of Isas they must go down the stocks and shares route, taking on a degree of risk that they may not want, or even understand.

Equalising the Isa rules for investors and savers makes sense. It provides a genuine choice to those who want their savings to work as hard as possible without gambling on the outcome.

Financial Mail’s campaign to change the Isa rules understands this public concern, and proposes a simple and straightforward way to address them.

After all, the Isa rulebook has been changed many times since 1999. Now is a good time for the next step.

David Cutter: 'We must reward forgotten victims of the credit crunch'

Cash savers are the forgotten victims of the credit crunch. Why? Because they are caught up in the unintended consequences of measures to resolve a crisis that was not of their making.

These include the maintenance of a historically low Bank of England base rate of 0.5 per cent for an unprecedented three-plus years, with the tangible possibility that it could fall even further.

While this is undoubtedly keeping the wolf from many borrowers’ doors, it is doing nothing to help those people who have saved responsibly all of their lives, only to find they are earning relatively meagre returns on the nest eggs they have set aside.

And matters are made worse by the fact that many rely on top-up income from their savings to support them in retirement.

While maintaining a low cost of borrowing is staving off a deeper financial crisis fuelled by increased mortgage defaults, it is important not to forget savers also have a vital role to play in the long-term recovery of our markets and economy.

And it is for this reason, as well as their personal wellbeing, that they need to be encouraged and supported.

As a mutual with a business model based on lending what our savers deposit, we understand implicitly that savers are our lifeblood.

As a result we are constantly addressing their needs in this challenging environment through straightforward, good value savings accounts.

The same is true of the wider economy where the funding provided by savers is the bedrock on which the mortgage market is built.

These are difficult economic times for everyone, but nevertheless everything possible should be done to try to encourage and reward savers for having the discipline and determination to do the right thing.

This is why we are backing Financial Mail’s campaign to allow cash savers to utilise their full £11,280 annual Isa allowance.